This is probably one of the most common questions I hear nowadays: how do I get my shipments from China to Amazon FBA?
While shipping products from China to Amazon warehouses isn’t incredibly difficult, it’s also slightly more complex than asking your Supplier to stick a UPS label on a product and send it to a single Amazon warehouse. In this post I’ll discuss the different ways you can get your products to Amazon FBA distribution centers.
Your Choices: Direct to FBA or Via a U.S. Based Middle-Man
How to get your products to Amazon FBA really boils down to two choices: you can either ship your items directly to Amazon FBA warehouses from China or you can first ship to yourself or another U.S. based middle man and then ship to Amazon FBA.
If you’re shipping directly from China, you will have to instruct your Supplier to prep your goods completely to FBA specifications. Many Suppliers nowadays are familiar with Amazon FBA and can handle this no problem, but like anything with China, there’s always a lot of room for miscommunication. If you’re shipping via a U.S. based middle man (including if the middle man is yourself), you can have one consolidated shipment from China broken into smaller packages, quality inspected, and prepped for FBA. But the rub is you have to either do those things yourself or pay someone else to do it.
The Pros/Cons of Shipping Direct to Amazon FBA (and the Challenges)
The pros of shipping directly from China to Amazon FBA warehouses are:
- Often quicker transit times as there’s no stopover at a middle man
- You don’t need to pay a middle man in the U.S. and/or liaison with them
However, there’s a few cons/challenges of shipping directly to Amazon FBA:
- Amazon requests your products to be shipped to multiple warehouses, not one centralized location.
- All duties and freight must be paid for before arriving to Amazon (Amazon will not pay a penny to accept a shipment).
- You don’t have an opportunity to inspect your products once they arrive.
- Amazon’s packaging and shipping requirements.
Let’s take a look at each of these challenges more in depth.
Multiple Amazon Warehouses
This is the biggest headache about shipping to Amazon: Amazon will almost certainly require you to ship your products to multiple warehouses unless you have Inventory Placement turned on (more on this later).
If you’re shipping three boxes to three locations it’s almost certainly going to be more expensive than shipping three boxes to one location. It can quickly eat up all of your margin. Consider the graphic below: It costs over twice as much to ship three boxes to three locations as it does the equivalent of those three boxes to one location.
There is a solution to having your products shipped to multiple Amazon warehouses: turn “Inventory Placement” on. You do this by going to Settings -> Fulfillment by Amazon. This will make all of your items go to one distribution center.
What’s the catch you say? (you didn’t think there was a catch did you?) You pay for this service. For non-oversize items it’s $0.40 per item + $0.10 per pound over 2 lbs. For oversized items it is $1.30 per item + $0.20 per pound over 5 lbs. And there’s no way to turn on Inventory Placement for some items or pick which warehouse your products go to.
All Duties and Freight Must be Prepaid
Amazon won’t pay a penny to accept your products so they must be shipped Delivery Duty Paid (DDP). For most carriers including UPS you can opt to have all charges billed to you rather than Amazon.
Speaking from experience, you have to be very careful when sending items to Amazon to ensure there are absolutely no charges billed to Amazon. They won’t hesitate to reject your shipment you paid $400 in air freight for because of a $20 in duties being billed to Amazon.
The good news is that if you’re shipping products worth $800 or less (at your cost) to an Amazon FBA USA location it will fall under the $800 de minimis threshold meaning you will not be charged any duties and your goods should arrive to FBA without any charges owing.
You Can’t Inspect Your Products
This is possibly the biggest danger in sending items directly to Amazon – you will have no opportunity to inspect them prior to sending them. Even though I have thorough quality control checklists and I enlist the services of a third party inspection company, I’m still routinely surprised by errors made from my Chinese Suppliers, simple things like putting blue widgets in the red widget box and so on.
When these errors occur, you’re not going to hear about them until your customers complain. This can mean A-Z cases and/or negative feedback.
If you are going to send items to Amazon directly from China, make sure to request photos of your widgets and packaging from your Supplier with every conceivable angle and view possible or better yet, use a third party inspection company.
Amazon’s Packaging and Shipping Requirements
If you’re sending small parcel shipments to FBA (i.e. being sent via UPS or FedEx) the packaging and labeling requirements actually aren’t that stringent. The most important is ensuring each item has a scannable bar code or FNSKU. Each box will also need a carton label attached to the outside. Amazon is fairly relaxed regarding labeling errors and will often label any incorrect items for you upon receipt (and charge you for it).
If you’re shipping pallets or full container loads, things become incrementally trickier and it’s beyond the scope of this article (if you need help with this, post below and I may consider doing a post strictly for this).
The Other Problem Shipping Directly to FBA
The thing that I hate the most about shipping products to FBA directly is that as soon as I ask my Supplier to label products with an FNSKU, attach Amazon Carton labels, and tell them what warehouses to send the products to, that Supplier now knows my exact sales strategy for those products. If I start selling thousands of units via FBA, there’s a possibility that my Supplier may think “Oh, maybe I should just sell directly to Amazon FBA”. And a lot of Chinese Suppliers are now starting to do this.
The Pros/Cons of Shipping to a Middle Man First (and the Challenges)
You can simply have your shipments from China shipped directly to yourself or you can use a third party middle man. There are no shortage of middle men that will gladly prep your FBA shipments for you (you can search around Google or in my course I can give you some of these third party logistics company I have personally used). They’re often called “Pick and Packs”, “prep and ship” or simply “3PL” (third party logistics). Pick any port city or border town and there will be multiple such companies. I still use a middle man when shipping to FBA for almost all of our shipments.
There’s several pros to using a Middle Man:
- You can have products shipped from China in one consolidated shipment and broken down into smaller packages in the U.S.
- You can quality inspect the products once they arrive
- You sales strategy remains anonymous to your Chinese Suppliers
- Very unlikely to have shipments rejected by FBA
The cons and challenges with shipping via a U.S. based middle man are:
- You either have to do work yourself or pay someone to do it yourself
- It takes longer to have your shipments received by FBA
In my opinion, aside from time and money, there’s no real disadvantage to using a middle man. Having an American based set of eyes looking at your shipment before it goes to Amazon can potentially eliminate logistical issues like Amazon rejecting your shipment because of non-compliance (i.e. unpaid duties) and customer service issues (i.e. all of your products being mislabelled).
But oh yeah, that time and money thing.
Middle Man: Time Costs
If you’re having your products first shipped to a middle man, it’s going to add time to how long it takes FBA to receive your shipments. First, the middle man is going to likely spend 2-5 days receiving your stock and preparing it. Second, if you’re using Amazon’s partnered carrier (UPS) for onward shipping to Amazon warehouses, this will add another 3-6 days in transit time (opposed to shipping direct to Amazon from China which will almost certainly be via air). So more or less, using a middle man will add at least 1-2 weeks in lead time to get to Amazon FBA.
Middle Man: Money Costs
If you’re using a middle man, it will cost you money, although they may be less expensive than you imagined. I’ve attached a cost sheet from one prep and ship below. To summarize, you’re going to get charged a ‘receiving fee’ (normally around $1-$5 per carton or $10-$50 per pallet), a pick/pack fee to actually ship the products (not including carrier fees of course) to Amazon FBA (normally around $1-$4) and then any labeling fees like bar codes (normally around $0.1-$0.25).
However, remember in our earlier example, we found that it cost $426 to ship 3 separate cartons to 3 locations from China to the United States or $210.80 for 3 cartons to 1 location. Those savings almost certainly are more than your middle man costs.
When to Ship Direct and When to Use a Middle Man
Here’s when I recommend you to use a middle man when shipping to Amazon FBA:
- It’s your first shipment from a Supplier, this way you can inspect it and also have an American based company prep/label it.
- It’s your first time using FBA, this way you avoid making any errors resulting in your shipment being rejected and sent back to China.
- It’s financially cheaper to use a middle man specifically due to the savings in having one consolidated shipment sent from China.
When to Ship Directly from China to FBA
- You’re shipping a small physical amount of products (1 carton) and it is valued under $800.
- Time is absolutely critical for you and every day counts.
- You have lengthy experience with your Supplier (and/or you’ve used a third party inspection agency in China) and you have lengthy experience shipping products to Amazon FBA and it’s cheaper than using a Middle Man.
In my opinion, if you’re relatively new to the whole importing game or Amazon FBA game, you should have your first couple of shipments sent directly to your home or business if at all possible. You should handle your products personally at some point.
Hopefully this article has addressed the pros and cons of shipping direct from China to Amazon FBA as well as using a Middle Man.
How do you ship your products to Amazon FBA warehouses? What has been your experience shipping directly from China? Has everything gone smoothly or have you run into a few hiccups along the way. I’d love to hear your experience in the comments below.
Interested in creating your own million dollar brand importing products from China? Mike and Dave will show you exactly how you can do it to with their Importing Kick @#$ Products from China Course. Read more about the course.